The Peter Lynch Approach: Investing in "Understandable" Stocks

by Wayne A. Thorp, CFA

The Peter Lynch Approach: Investing In

Outside of Warren Buffett, perhaps no other investment “guru” is better known than Peter Lynch, the manager of Fidelity’s Magellan Fund from 1977 to 1990.

During his tenure at Fidelity, Mr. Lynch honed his bottom-up approach to stock selection, focusing on fundamental analysis that emphasizes a thorough understanding of the company, its prospects, its competitive environment, and whether the stock can be purchased at a reasonable price.

Mr. Lynch outlined his strategy in his books “One Up on Wall Street” and “Beating the Street,” in which he described how his own approach could be used by individual investors.

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Wayne A. Thorp, CFA is a vice president and senior financial analyst at AAII and editor of Computerized Investing. Follow him on Twitter at @AAII_CI.


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